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Wednesday, October 8, 2008

Xcel to use wood chips for electricity at plant in northern Wisconsin

Xcel Energy Inc. will announce today that its power plant in northern Wisconsin will be the largest in the Midwest to make electricity by burning wood chips.

The utility will invest $55 million to $70 million to convert a coal-fired boiler to one that would convert chipped waste wood from northern Wisconsin’s forests into a gas for power production.

Xcel is an eight-state utility company based in Minneapolis. Its Wisconsin electric and natural gas utility is based in Eau Claire.

The initiative is part of Xcel’s strategy to become a leader in production of renewable energy, a plan that could reap financial rewards if the federal government moves to regulate emissions linked to global warming.

Through its wind farms based primarily in Minnesota, Xcel is the largest producer of wind energy in the country, according to the American Wind Energy Association. The company also has 19 dams generating hydroelectric power on rivers in northern Wisconsin.

The Ashland power plant consists of three boilers, two of which burn both biomass and a small amount of coal, and one that burns coal exclusively. The new proposal, to be filed with state regulators this fall, would replace that coal-only boiler with a biomass-to-gas system, company spokesman Brian Elwood said.

One concern, he said, was whether there would be enough waste wood to supply the plant. A study by the Madison-based Energy Center of Wisconsin found there would be enough wood left after forests are logged to supply an expansion, he said.

In 2006, Xcel Energy funded a study with the Energy Center of Wisconsin to investigate the amount of biomass that could be removed from Wisconsin's forests to support sustainable energy resources and any associated environmental impacts. The study concluded that area forests within a 50-mile radius of the Bay Front Power Plant could support additional biomass removal without adverse impacts to the local ecosystem. Dedicated biomass energy plantations could ultimately provide a portion of the plant’s increased biomass needs, with additional benefits from carbon sequestration.

"Xcel Energy has been a long-time leader in providing renewable energy from local sources to the citizens of Wisconsin," said Michael Vickerman, executive director, RENEW Wisconsin. "This biomass initiative continues that tradition."

Mark Redsten, executive director, Clean Wisconsin, agreed.

"This project will both lessen Wisconsin's reliance on imported fossil fuels and propel us closer to the renewable energy goals of Gov. Doyle's Task Force on Global Warming," Redsten said.